It did work at ARR's launch at least - I gave my 1.0 CE Buddy Pass to my brother and it worked fine for him - he was able to use my ARR B4/early access installation file to install the game and signed up with the 1.0 Buddy Pass on the Mogstation with no problems. This was about five months ago though so things might have changed since. But as far as I'm aware they still do work.

Note this will only work for the PC version - I'm pretty sure you cannot use it with the PS3 version.